FreeTaxUSA 2022 Review: Is It Really Free?

FreeTaxUSA Walk-Through Review Video

FreeTaxUSA - Is It Really Free?

While "free" is in the name, FreeTaxUSA might still cost you money. The company does offer free federal tax filing, but all filers pay $14.99 to file their state returns. The company also offers upgrades such as audit support ($6.99) and assistance from a professional ($24.99).

Despite its somewhat misleading name, FreeTaxUSA offers an excellent bargain, especially for users who don’t qualify for free returns. Out-of-state landlords, side hustlers, and self-employed people may all appreciate FreeTaxUSA’s low cost and usability.

What's New In 2022?

FreeTaxUSA showed marked improvement with its navigation in 2022. The software uses a blend of question and answer guidance and menu-driven guidance. This allows users to get through the software quickly but also guides users through tricky parts.

The user interface is still a bit text-heavy. And the transitions between question-and-answer navigation sections to the menu navigation sections are abrupt. However, low-jargon language helps users through complex filing challenges like using depreciation calculators on rental properties.

Does FreeTaxUSA Online Make Tax Filing Easy In 2022?

FreeTaxUSA offers bargain-basement pricing, but its pricing belies its quality. FreeTaxUSA is high-quality software that beats out most competitors that are priced in the middle of the pack. 

It’s not as easy to use as TurboTax or H&R Block. Those premium software packages boast imports and integrations that can dramatically ease the pains of tax filing.

However, FreeTaxUSA’s notable features such as question and answer guidance, section summaries, and rolling return totals make the software easy to use. The software’s error handling also makes it tough to skip sections.

Although users may spend time keying information into the software, FreeTaxUSA frees filers from the most burdensome aspects of tax filing.

Notable Features

FreeTaxUSA isn’t premium software, but it's loaded with excellent features that make it a bargain contender. These are a few of the most notable features.

Q&A Plus Menu Guidance

FreeTaxUSA blends question and answer guidance with menu selection navigation. The blended approach provides oversight in trickier tax sections while allowing users to breeze through irrelevant sections.

The only drawback to this navigation style is the abrupt transitions. Users may wrap up a question and answer segment only to find themselves on a menu that they may not recognize.

Low-Cost And Simple Pricing

FreeTaxUSA has one primary pricing model. Federal filing is free. State filing costs $14.99. Users have the option to upgrade, but the base price is the same for all filers.

Section Summaries

FreeTaxUSA displays section summaries as users go through the software. These summaries allow users to see all their income, deductions, credits, and other factors at the same time. A simple glance can help users recognize that they may have skipped a section.

Audit Support Available

Audit support isn’t included with FreeTaxUSA’s base price. But audit assistance is included on the Deluxe Edition which costs just $6.99. That's a bargain for audit assistance compared to competitors.

Drawbacks

Although FreeTaxUSA offers plenty of value, it also has several drawbacks for users seeking premium features. Here are a few shortcomings of the software that you should be aware of.

No Imports

Users cannot import W-2 or 1099 forms into FreeTaxUSA. Users must transcribe information from their tax documents into the software. Typically, this takes just a few minutes, but it's a drawback for users with multiple standard tax documents.

Must Pay For State Filing

Several companies offer include free state filing for W-2 employees on their free tiers. But state tax return prep costs $14.99 with FreeTaxUSA, even on its Free Edition. This isn’t a huge price to pay, but it could cause some filers to pay slightly more with FreeTaxUSA.

Abrupt Transitions May Confuse First-Time Filers

FreeTaxUSA’s approach to navigation makes a lot of sense. It prevents screen fatigue while ensuring that users can access everything they need. However, the software abruptly transitions users from the question-and-answer navigation to menu selections. Users who aren’t familiar with this pattern may struggle with the software at first.

FreeTaxUSA Prices And Plans

The FreeTaxUSA approach to filing is straightforward. Federal filing is always free, and state filing costs $14.99 per state. Users who want audit support will pay extra, but you’ll never pay extra based on the complexity of your filing situation.

How Does FreeTaxUSA Compare?

FreeTaxUSA is one of the most popular tax software companies, so our comparisons focus on other popular software options. TurboTax and H&R Block are both more expensive than FreeTaxUSA but offer slightly better functionality.

However, all of these programs have a free tier. So we think FreeTaxUSA tends to be better for self-employed people, landlords, and people who lived or worked in multiple states that are experienced in filing their taxes.

How Do I Contact FreeTaxUSA Support?

FreeTaxUSA customers can access basic customer support by logging into their account and sending a message. The company says that they typically respond to questions within half an hour. You can also send an email to support@support.freetaxusa.com.

With the Deluxe Edition, you also get "Live Chat with Priority Support." At this level, you get to jump to the front of the queue to chat directly with a tax specialist. Chat support is available Monday - Friday, 10 AM to 9 PM Eastern (ET).

It appears that FreeTaxUSA is also continuing to offer low-cost advanced support from tax preparers such as CPAs or Enrolled Agents (EAs). In our test of FreeTaxUSA, we again found a “Pro Support” add-on that could be purchased for $24.99.

It should be noted that FreeTaxUSA isn't currently advertising Pro Support on its sales pages, so we're unsure if this feature will be going away. But for now, we're still seeing it inside the software.

The Pro Support service allows users to talk and screen share with professionals who can provide specific guidance for filers. If it continues to offer it, FreeTaxUSA likely has the lowest-cost expert advice add-on in 2022.

Is It Safe And Secure?

FreeTaxUSA has not suffered from any major security risks. Its credentials prove that it meets security standards set for tax filing companies. It encrypts data at rest and requires multi-factor authentication. Research did not reveal any historic security breaches. By all standards, users should trust FreeTaxUSA when filing their taxes.

However, even users who trust FreeTaxUSA should know that their data is at some level of risk. FreeTaxUSA could be targeted by hackers, and a data breach could expose personal information. This is always a risk when users engage with internet-based software.

FreeTaxUSA FAQs

Here are some common questions we get about FreeTaxUSA:

Can FreeTaxUSA Online help me file my crypto investments?

If you only traded one or two tokens, you can use FreeTaxUSA to file your returns. You’ll have to look up the US Dollar basis of the trade, but you can key in the trades. However, active crypto traders will want to look elsewhere. Typing in dozens of trades into FreeTaxUSA is unlikely to be a good use of time.

Can I request my stimulus check through FreeTaxUSA?

Tax filers who didn’t receive all of their stimulus money can correct the error through FreeTaxUSA. The software calculates how much a user is owed based on the Rebate Recovery Credit. Note that this credit only applies to the third stimulus payment which was issued in 2021. If you didn’t receive your first two stimulus payments (issued in 2020), you'll need to file a 2020 tax return.

I didn’t receive the full amount for Advanced Child Tax Credit Payments. Can FreeTaxUSA help me get the rest?

Yes, FreeTaxUSA offers robust guidance for parents who didn’t receive the full amount for their Advanced Child Tax Credit Payments. These parents can report what they received, and FreeTaxUSA will ensure that the IRS makes up the shortfall.

Do I have to use a self-employed tier for my side hustle?

No, FreeTaxUSA charges all users the same amount, no matter the complexity of their filing situation. Federal filing is always free and state filing always costs $14.99 per state.

Does FreeTaxUSA offer refund advance loans?

FreeTaxUSA is not offering refund advance loans in 2022.

Does FreeTaxUSA offer any deals on refunds?

No, FreeTaxUSA isn't currently offering any deals or incentives associated with refunds.

Is FreeTaxUSA legitimate?

Yes! It's a popular tax software preparation company that has been in business since 2001.

Are TaxHawk, FreeTaxUSA, and 1040Express owned by the same company?

Yes, FreeTaxUSA is a subsidiary of TaxHawk Inc. The parent company owns three software brands, TaxHawk, FreeTaxUSA, and 1040Express.

Is FreeTaxUSA better than TurboTax?

It depends. FreeTaxUSA is generally cheaper in price than TurboTax, but TurboTax does offer free file as well. The big difference comes down to ease of use, and getting the support you want.

FreeTaxUSA Features